EMSC breaks; Select Medical, Delphi, U.S. Foodservice, Targus, Cellular One, Wyle set talk

By Sara Rosenberg

New York, April 27 - Emergency Medical Services Corp.'s (EMSC) credit facility freed up for trading on Wednesday, with levels on the term loan B quoted above its original issue discount price, and Savvis Inc.'s term loan headed lower after news emerged that the company is being acquired by CenturyLink Inc.

Over in the primary, Select Medical Corp., Delphi Corp., U.S. Foodservice Inc., Targus Group International Inc. and Cellular One revealed price talk as their deals were presented to lenders during the session, and Wyle Services Corp. approached lenders with an amendment and extension proposal

Also, Iasis Healthcare LLC upsized its facility and firmed pricing, PaperWorks Industries flexed higher, Lee Enterprises Inc. shifted its second-lien notes to loan form, and Golden Living finalized the spread on its term loan at the high end of guidance.

Additionally, Allen Systems Group Inc., Springs Window Fashions LLC, Legendary Pictures, BCBG Max Azria Group and Securus Technologies disclosed that they are getting ready to bring new deals to market.

Emergency Medical trading

Emergency Medical Services' credit facility made its way into the secondary market on Wednesday, with the $1.44 billion term loan B (B1/B+) quoted at par ¼ bid, par ¾ offered on the open, according to traders. The debt was later seen by one trader at par ½ bid, 101 offered and by a second trader at par ¾ bid, 101¼ offered.

Pricing on the B loan is Libor plus 375 basis points with a 1.5% Libor floor, and it was sold at an original issue discount of 991/2. There is 101 soft call protection for one year.

During syndication, pricing on the term loan B was reduced from Libor plus 400 bps and the call protection was added. Also, initially the tranche was expected to be sized at $1.375 billion, but it was increased prior to launch to account for a small acquisition.

The company's $1.79 billion credit facility also includes a $350 million ABL revolver that is priced at Libor plus 250 bps with no Libor floor.

Emergency Medical to be bought

Proceeds from Emergency Medical's credit facility, along with $950 million of senior unsecured notes and up to $900 million of equity, will be used to fund its purchase by Clayton, Dubilier & Rice LLC for $64 in cash per share of common stock and exchangeable unit. The transaction is valued at $3.2 billion.

Closing on the transaction is expected in the second quarter, subject to customary conditions, including regulatory approvals and approval by the company's stockholders.

Deutsche Bank Securities Inc., Barclays Capital Inc., Bank of America Merrill Lynch, Morgan Stanley & Co. Inc., RBC Capital Markets LLC, UBS Investment Bank, Natixis and Citigroup Global Markets Inc. are the lead banks on the credit facility.

Emergency Medical is a Greenwood Village, Colo.-based provider of health care transportation services and outsourced physician services to health care facilities.

Savvis softens on buyout

Savvis' term loan retreated in trading as the company announced that it is being purchased by CenturyLink in a cash and stock merger valued at $40 per share, or about $2.5 billion, plus net debt of roughly $700 million that will be assumed or refinanced at close, according to traders.

Specifically, Savvis stockholders will receive $30 per share in cash and $10 in shares of CenturyLink common stock, subject to adjustment.

Following the news, one trader had the term loan quoted at par ½ bid, 101 offered, down from par 7/8 bid, 101 3/8 offered.

Meanwhile, a second trader had the loan quoted at par 5/8 bid, 101 offered, down from 101¼ bid, 101 5/8 offered.

CenturyLink gets commitment

To help fund the acquisition and refinance existing Savvis debt, CenturyLink has received a commitment for up to $2 billion of bridge loans, a news release said.

Bank of America Merrill Lynch and Barclays Capital Inc. are the lead banks on the new debt.

Closing on the transaction is expected to occur in the second half of this year, subject to the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act, and review by the Federal Communications Commission and international regulators.

Savvis is a Town & Country, Mo.-based provider of cloud infrastructure and hosted IT services. CenturyLink is a Monroe, La.-based telecommunications company.

LNR levels widen

LNR Property LLC's $325 million five-year term loan B was quoted at par 3/8 bid, par 7/8 offered on Wednesday morning, after breaking for trading on Tuesday at par ½ bid, 101 offered and then closing the day at par ½ bid, par ¾ offered, according to a market source.

Pricing on the loan is Libor plus 350 bps with a 1.25% Libor floor, and it was sold at an original issue discount at 99 3/8. There is 101 soft call protection for one year.

During syndication, pricing was lowered from Libor plus 375 bps and the discount firmed from talk of 99 to 991/2.

The Miami-based diversified real estate, investment, finance and management company's $365 million senior secured credit facility (Ba2/BB+) also provides for a $40 million three-year revolver.

Goldman Sachs & Co. and Bank of America Merrill Lynch are the joint lead arrangers and joint bookrunners on the deal that is being used to refinance existing bank debt.

Select Medical pricing

Moving to the primary, Select Medical held a bank meeting on Wednesday afternoon to kick off syndication on its proposed credit facility, and in connection with the event, price talk on the $1.2 billion term loan B was announced, according to a market source.

The term loan is being talked at Libor plus 375 bps with a 1.5% Libor floor and an original issue discount of 99, the source said, adding that there is 101 soft call protection for one year.

The company's $1.5 billion credit facility (B1) also includes a $300 million revolver.

J.P. Morgan Securities LLC, Goldman Sachs & Co., Bank of America Merrill Lynch, Morgan Stanley & Co. Inc., Wells Fargo Securities LLC and RBC Capital Markets are the lead banks on the deal that will be used to refinance debt.

Select Medical is a Mechanicsburg, Pa.-based operator of specialty hospitals and outpatient rehabilitation clinics.

Delphi discloses details

Another deal to launch with a meeting was Delphi's credit facility, at which time structure and price talk were revealed to the market, according to a source.

The $1.4 billion deal includes a $1.15 billion six-year term loan B talked at Libor plus 300 bps to 325 bps with a 1.25% Libor floor and a $250 million five-year term loan A talked at Libor plus 325 bps with no floor, the source said, adding that both tranches are being offered at a discount of 991/2.

The Troy, Mich.-based automotive electronics manufacturer's $2.4 billion credit facility also provides for a $1 billion five-year revolver.

J.P. Morgan Securities LLC is the lead bank on the financing that will be used to help fund $4.4 billion of stock repurchases representing the stakes of General Motors Corp. and the Pension Benefit Guaranty Corp. in Delphi.

Other funds for the buyback will come from $1.1 billion of senior notes.

U.S. Foodservice guidance

U.S. Foodservice also released price talk as it launched a $425 million six-year covenant-light term loan B, according to a market source.

The B loan is being guided at Libor plus 375 bps to 400 bps with a 1.25% Libor floor, an original issue discount of 99½ and 101 soft call protection for one year, the source said.

Commitments are due on May 6.

J.P. Morgan Securities LLC, Deutsche Bank Securities Inc., Citigroup Global Markets Inc., Goldman Sachs & Co., Morgan Stanley & Co. Inc. and Wells Fargo Securities LLC are the lead banks on the deal that will be used to refinance existing notes.

U.S. Foodservice is a Columbia, Md.-based broadline foodservice distributor.

Targus talk emerges

Targus Group launched its $185 million five-year term loan on Wednesday with preliminary talk of Libor plus 800 bps to 850 bps with a 1.5% Libor floor and an original issue discount of 98, according to a market source.

The loan includes call protection of 103 in year one, 102 in year two and 101 in year three, as well as 1% amortization and a 75% cash flow sweep, the source said.

Goldman Sachs & Co. and Bank of America Merrill Lynch are the lead banks on the deal that will be used to refinance existing first-lien revolving credit facility and term loan debt.

The company is also getting a $60 million ABL revolver that has been pre-committed, and is therefore, not being syndicated at this time.

Targus is an Anaheim, Calif.-based maker of mobile accessories.

Cellular One launches

Cellular One held a bank meeting as well, launching its $175 million six-year term loan B with talk of Libor plus 500 bps with a 1.5% Libor floor and an original issue discount of 99, sources said.

The company's $180 million senior secured credit facility (B2/B) also includes a $5 million five-year revolver.

Barclays Capital Inc. is the lead bank on the deal that will be used to refinance existing debt, redeem preferred equity and fund a dividend.

Senior secured leverage is 3.4 times and net total leverage to 3.2 times.

Cellular One, a Wayne, Pa.-based provider of wireless phone services, is seeking commitments by May 11.

Wyle seeks amend/extend

Wyle held a call in the morning to launch a proposal to lenders, under which its $283 million term loan B (B1/BB) would be extended by one year to 2017 and pricing would be reduced, according to a market source.

Initial pricing on the extended loan will be Libor plus 450 bps with a 1.5% Libor floor since corporate ratings are B3/B+. Once corporate ratings are B2/B, pricing will drop to Libor plus 375 bps. The debt is being offered at an original issue discount 99¾ and includes 101 soft call protection for one year.

Pricing would be coming down from the current level of Libor plus 575 bps with a 2% Libor floor. This current spread is also tied to a grid. If the corporate rating is B2/B, the spread is Libor plus 450 bps when senior leverage is less than 2.85 times and Libor plus 500 bps when senior leverage is more than 2.85 times. And, if the corporate rating is lower than B2/B, pricing is Libor plus 525 bps at less than 2.85 times senior leverage and Libor plus 575 bps at more than 2.85 times senior leverage.

Wyle revising covenant

In addition, as part of the amendment, Wyle asked lenders to remove the total leverage and interest coverage covenants and rework the senior secured covenant so that it would be 4½ times for the life of the loan, the source remarked.

Furthermore, the accordion feature would be governed by an incurrence covenant of 4 times instead of being tied to the interest coverage test, and total debt would be governed by a 6 times incurrence test, as opposed to being limited by the leverage covenant.

Barclays Capital Inc. is the lead bank on the deal and is asking for commitments by May 6.

Wyle is an El Segundo, Calif.-based provider of high-tech systems engineering, testing and information technology services.

Iasis tweaks deal

Also in the primary, Iasis Healthcare increased its seven-year term loan B (Ba3/B) to $1.025 billion from $935 million, firmed pricing at Libor plus 375 bps, the tight end of the Libor plus 375 bps to 400 bps talk and cut the Libor floor to 1.25% from 1.5%, according to a market source.

The original issue discount of 99½ and 101 soft call protection for one year were left intact.

The company's $1.325 billion credit facility, up from $1.235 billion, still provides for a $300 million five-year revolver (Ba3/BB-) priced at Libor plus 350 bps with a 150 bps upfront fee.

Recommitments are due at noon ET on Thursday and allocations are targeted to go out that afternoon.

Bank of America Merrill Lynch, Barclays Capital Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. and J.P. Morgan Securities LLC are the lead banks on the deal.

Iasis trims notes

As a result of the B loan upsizing, Iasis reduced its senior notes offering to $850 million from $935 million. The 8 3/8% notes priced at 99.277 to yield 8½%.

The extra $5 million being raised through the term loan upsizing will be used to fund the original issue discount on the bond deal, the source added.

Proceeds from the credit facility and bonds will be used to refinance existing debt, to fund a $230 million dividend and to help fund the acquisition of St. Joseph Medical Center.

Closing on the credit facility will occur on May 3, concurrent with completion of the bond offering.

Iasis is a Franklin, Tenn.-based owner and operator of medium-sized acute care hospitals.

PaperWorks flexes

PaperWorks Industries lifted pricing on its $250 million credit facility (B2/B+) to Libor plus 550 bps from talk of Libor plus 475 bps to 500 bps, while leaving the 1.5% Libor floor intact, according to a market source.

Prior to the deal's April 12 bank meeting, early guidance had been in the Libor plus 450 bps area with a 1.5% floor.

The facility consists of a $40 million revolver and a $210 million term loan.

The term loan is still being offered at an original issue discount of 99 but now also includes 101 soft call protection for one year, the source said.

BMO Capital Markets Corp. is leading the deal that will be used to refinance existing debt.

PaperWorks is a Philadelphia-based integrated coated-recycled board and folding carton company.

Lee moves to loan

Lee Enterprises changed its $375 million seven-year second-lien notes tranche to a second-lien term loan, according to a market source.

Price talk on the loan is the same as the talk that was heard on the notes - 9% cash and 6% PIK with an original issue discount of 95.

Credit Suisse (USA) Securities Inc. and Deutsche Bank Securities Inc. are the lead banks on the deal that will be used, along with $680 million of senior secured first-lien notes due 2017, to refinance basically all of the company's outstanding debt.

Lee is a Davenport, Iowa-based newspaper publisher.

Golden Living firms spread

Golden Living set pricing on its $1.5 billion term loan at Libor plus 375 bps, the wide end of the Libor plus 350 bps to 375 bps talk, and left the 1.25% Libor floor and original issue discount of 99 unchanged, according to a market source.

The company's $1.575 billion credit facility (B1/B+) also includes a $75 million revolver.

Citigroup Global Markets Inc. and RBC Capital Markets LLC are the lead banks on the deal that will be used to refinance existing bank borrowings and CMBS debt.

Golden Living is a Fort Smith, Ark.-based provider of post-acute health and wellness services.

Allen readies add-on

In other news, Allen Systems is scheduled to hold a bank meeting on Thursday to launch a proposed $115 million term loan add-on that is being talked at Libor plus 475 bps with a 1.75% Libor floor and an original issue discount of 99, according to a market source.

Price talk on the add-on is in line with pricing on the company's existing $80 million term loan that was obtained in November 2010.

Bank of America Merrill Lynch and KeyBanc Capital Markets LLC are the lead banks on the deal that will be used to help fund the acquisition of visionapp AG, a Germany-based provider of software and services for private, public and hybrid cloud solutions.

Allen Systems is a Naples, Fla.-based enterprise software provider.

Springs Window sets launch

Springs Window Fashions has scheduled a bank meeting for Friday to launch a proposed $475 million credit facility that is being led by J.P. Morgan Securities LLC, according to a market source.

The facility consists of a $50 million five-year revolver, a $300 million six-year first-lien term loan and a $125 million seven-year second-lien term loan, the source said.

Proceeds will be used to refinance existing debt and fund a dividend.

Springs Window Fashions is a manufacturer of blinds, shades and drapery hardware.

Legendary Pictures refinancing

Legendary Pictures is set to hold a bank meeting on Thursday to launch a $700 million credit facility that will be used to refinance existing debt, according to a market source.

The facility consists of a $500 million revolver and a $200 million term loan B, the source said, adding that price talk is not yet available.

J.P. Morgan Securities LLC is the lead bank on the deal.

Legendary Pictures is a Burbank, Calif.-based film production company.

BCBG coming soon

BCBG Max Azria is set to hold a bank meeting on Thursday to launch a $230 million term loan, according to a market source.

Goldman Sachs & Co., Bank of America Merrill Lynch, UBS Securities LLC and Guggenheim are leading the deal that will be used to refinance existing debt.

BCBG is a Vernon, Calif.-based designer, retailer and distributor of women's apparel and accessories.

Securus launching next week

Securus Technologies is scheduled to hold a bank meeting on May 4 to launch a proposed $365 million credit facility that consists of a $35 million revolver, a $233 million first-lien term loan B and a $97 million second-lien term loan, according to a market source.

BNP Paribas Securities Corp. and GE Capital Markets are the lead banks on the deal that will be used to help fund the buyout of the company by Castle Harlan from H.I.G. Capital.

Securus is a Dallas-based provider of specialized telecommunications products and services for the corrections communications marketplace.

Attachmate wraps acquisition

Attachmate Group completed its purchase of Novell Inc., a Waltham, Mass.-based developer, seller and installer of enterprise software, according to a news release.

To help fund the transaction, Attachmate got a $1.19 billion senior secured credit facility, consisting of a $40 million five-year revolver (B1/BB-), an $875 million six-year first-lien term loan (B1/BB-) and a $275 million 61/2-year second-lien term loan.

Pricing on the first-lien term loan is Libor plus 500 bps and pricing on the second-lien is Libor plus 800 bps, with both having a 1.5% Libor floor and sold at a discount of 99. The second-lien has call protection of 103 in year one, 102 in year two and 101 in year three.

Credit Suisse Securities (USA) LLC, RBC Capital Markets LLC, Goldman Sachs & Co. and Citadel led the deal.

Attachmate is a Seattle-based provider of access and integration software for legacy systems.

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